News Article: 28 June 2011

ATVOD ANNOUNCES LOWER FEES FOR VOD SERVICES

Average fees reduced by 5.5% as new banded fee structure introduces much lower fees for smaller providers and a cap for larger providers

Following a public consultation, The Authority for Television On Demand (“ATVOD”) , the regulator for video on demand services, has today announced its fee tariff for the year ending 31 March 2012. The new tariff, approved by Ofcom, replaces the flat rate of £2900 per service set for the previous year with a more progressive tariff and demonstrates the extent to which ATVOD has listened to the concerns of service providers. The key outcomes are:

- Average fees reduced by 5.5%

- A new concessionary rate of £100 for non-commercial service providers

- New concessionary rates of £150 and £200 for commercial service providers with turnover below £50,000 and £100,000 respectively

- A three band standard tariff based on the turnover of the service provider, with rates set at £800, £5175, and £10,350 for the first service, and a maximum of £800 per service for further services from the same provider

- A cap of £25,000 on the total fees paid by any single provider

Basing fees on the turnover of the service provider is seen as an interim measure while the industry establishes common and accepted methodologies for establishing the scale of a particular video on demand service.

Commenting on the decision, ATVOD Chief Executive Pete Johnson said:

“We entered the consultation with a completely open mind and our decision reflects the balance and strength of arguments made by our stakeholders in response to the available options. The new tariff addresses two of the biggest concerns expressed to us about fees during our first year: the impact on smaller providers, and the impact on providers with large numbers of services. Under the new tariff, we expect that at least 45% of service providers will pay no more than £800 and the smallest providers will pay £200 or less. At the other end of the scale, companies operating large numbers of services will pay just £800 for each extra service and will not pay more than £25,000 however many services they provide.

Charging arrangements for future years will need to reflect the evolution of the sector. We look forward to making an early start to discussions with the industry on this issue through the ATVOD Industry Forum”